The Moment for Medicare Reform

Congress should embrace the opportunity to pass a compromise measure announced Sunday that would both reform Medicare and add a prescription-drug benefit for the nation's seniors.

The group of Republicans and Democrats who crafted the compromise from different Senate and House bills found the right balance between competing visions for improving this federal program from the 1960s.

Most Republicans and some Democrats believe that to remain fiscally viable, Medicare must be open to market forces and more private insurers. Liberal Democrats, and a few Republicans, want it to remain strictly a government program.

The temptation to play politics rather than pass a compromise bill is tremendous. Seniors are a powerful voting bloc, and each political party may prefer to make the other seem responsible for any failure to pass a bill.

With the GOP dominating both chambers, and a Republican in the White House, prospects for passage of this bipartisan bill look good. But that assumes that House GOP leaders can keep their horses in the corral, and that at least 10 Senate Democrats resist any effort to block the bill.

In many respects, the bill's introduction of market competition into Medicare is but baby steps. It would only allow private health plans to compete with traditional Medicare in a six-year pilot program beginning in 2010 in six metropolitan areas.

That's six areas too many for opponents, who believe that market competition will destroy the program and drive up premiums for unhealthy seniors. These opponents say the healthiest seniors would move into health-maintenance organizations or preferred-provider organizations where they would, in theory, receive less expensive treatment, leaving a less-healthy pool of seniors in the traditional program. The higher costs the program would thus incur would cause standard Medicare premiums to skyrocket, these opponents predict.

That's possible. But the current bill does not introduce competition in one fell swoop. It calls for a limited experiment that could be expanded if successful or altered if not.

Proponents hope competition will help drive down the growth in Medicare's costs. The already financially shaky program will need such savings to help pay for the $400 billion the prescription-drug program will cost over 10 years.

As it is with most compromises, there's plenty in the bill to dislike. But lawmakers who want a prescription-drug benefit and those who want more competition in Medicare should consider that this may be their best opportunity in the next several years to achieve those goals.